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Deciding to buy a house is life-changing. It sets you on the path to an enormous milestone, and it’s something that will bring you great joy and satisfaction. However, before you sign on the dotted line, it’s important to make sure you’re financially prepared for the transaction. Improving your credit score is a great way to secure a lower interest rate and pay less in mortgage costs monthly. Here’s what you can do. 

How to Boost Your Credit Before Buying a House

1. Check Your Score

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Before you do anything else, it’s wise to assess your most recent credit report. You’ll see your score from each of the three credit bureaus, and you’ll have the chance to review any errors that might inadvertently lower your score. Dispute anything that’s incorrect, which should result in a credit increase. Bear in mind this can take some time, so it’s best to check your score early in the buying process, so you have more time to make improvements.

2. Pay Off Debts

When you have too many debts to pay, lenders may not view you as reliable. You might be turned down for loans, or the interest rate on your offers may be far higher than you’d like. You can avoid these situations by paying down your debts before you buy a house. Work on the biggest debt first, paying your way down. Look for ways to decrease what you have to pay, such as transferring the balance from a high-interest credit card to a no-interest card. While there may be a fee involved, you’ll pay considerably less each month and allow yourself to get ahead.

3. Lower Your Utilization

Ideally, you should aim to keep your credit card utilization below 30%. The higher it is, the more it indicates to lenders that you can’t pay your bills on time. Even if that’s not true, it’s best to lower your rate as much as possible before you begin the buying process. You can accomplish this by paying down your balances early, minimizing your spending, or increasing your credit limit. As your utilization rate improves, so will your score.

 

If you’re looking to buy a house in Atlanta, GA, turn to 20 West Realty. Proudly offering their expertise to help you find the property of your dreams, this full-service brokerage is committed to your satisfaction. They’ll work closely with you every step of the way to ensure that you love your new home—and that the transaction goes smoothly. Visit the website to browse properties for sale, or call (404) 850-0203 to schedule a consultation.

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